Finance Associated Press, December 20 (Reporter Zhou Xiaoya) was "named" for the second time in the year, and Oriental Huijin Futures received another fine.
On December 19, the official website of the Jilin Securities Regulatory Bureau issued 4 fines, and Oriental Huijin was ordered to take corrective measures, and the company's general manager Li Zehou, the company's chief risk officer Yu Huaiyu, and the company's asset management business head Shen Zhendong were all taken to issue warning letters. The ticket was issued last Friday (December 15).
Specifically, the violations mentioned in the fine involve weak internal control foundation of asset management business, insufficient management of employee marketing behavior, non-standard financial management, and inadequate information technology management. This is also the second time the company has received a fine this year, after the company's Shanghai branch was fined in May this year.
In the long run, the company has been punished by regulators every year in the past four years, and the lack of compliance and risk management has become the "hardest hit area" of punishment.
Oriental Huijin Futures was involved in four violations
Judging from the past penalties of futures companies, it is rare for companies similar to the above to be fined at the same time as three company executives. The Jilin Securities Regulatory Bureau said that after investigation, the violations of Oriental Huijin Futures involved four major aspects.
First of all, the internal control foundation of the asset management business is weak, which mainly reflects six violations. Failure to establish and improve a number of business management systems, failure to effectively strengthen business risk management, non-standard publicity in product promotion materials, non-standard investment operation management, failure to carry out due diligence before the investment target is put into the warehouse, failure to truthfully provide materials to the inspection team, lack of detailed research reports and risk analysis of individual important investments, misleading and inaccurate statements in information disclosure, and failure to provide appropriateness management standards and requirements to the distribution agency.
The second is the insufficient management of employees' marketing behavior, compliance management and risk control.
Again, the financial management is not standardized, the accounting is not accurate, and the net capital calculation is wrong.
Finally, information technology management is not in place, involving four violations. Failure to effectively implement the graded network security protection system, failure to carry out grading assessment of relevant important information systems in a timely manner, failure to establish disaster backup centers in the same city or other places for relevant important information systems, failure to carry out stress testing of important information systems at least once a year, and failure to establish a review mechanism for information release.
The Jilin Securities Regulatory Bureau believes that the above reflects that the compliance and risk management of Oriental Huijin Futures are not in place, and there are deficiencies in internal control. It was decided to take supervision and management measures against the company to order corrections. The company is required to complete the rectification of the above problems within one month of receiving the decision on regulatory measures, and submit a written rectification report to the Jilin Securities Regulatory Bureau, which will carry out acceptance.
Li Zehou, as the general manager of Oriental Huijin Futures, and Yu Huaiyu, as the company's chief risk officer, did not effectively perform their duties and bear the main responsibility for the above problems. Shen Zhendong, the head of the company's asset management business, was also issued a warning letter.
In the past four years, he has been fined one after another
Among the above-mentioned violations, the issue of employee marketing was mentioned twice during the year. In May, the company received another fine that also mentioned deficiencies in the management of employee marketing and service behavior.
On May 24, the Shanghai Securities Regulatory Bureau issued a decision on ordering the Shanghai branch of Oriental Huijin Futures to take corrective regulatory measures. The article mentions that some of the company's employees who are not qualified for futures trading consulting business send futures trading consulting advice to traders, the software provided to traders contains futures trading consulting advice, and the Internet marketing and customer service behavior of employees are not effectively controlled.
In addition, the management of the business site is not standardized. The branch did not conduct business in strict accordance with the domicile scope stipulated in the securities and futures business license.
In the long run, the company has received fines every year for four consecutive years since 2020, and the main issues involve the company's overall risk management and internal control.
For example, in 2020, the company was ordered to make corrections because it failed to conduct stress tests on the company's risk regulatory indicators in a timely manner according to market changes and business development, the risk management system was not effectively implemented, and the ratio of net capital to the company's risk capital reserves did not meet the prescribed standards during the period from April 1 to April 21 of that year. Similar to the latest punishment, at that time, Li Zehou, Yu Huaiyu and other company executives were also issued warning letters.
In 2021, the actual controller and controlling shareholder of the company occupied the company's own funds, and some of the funds had not been returned as of the time of punishment. At the same time, the company's internal control system for honest practice is not perfect, and there is no specific expenditure standard for marketing activities such as the procurement of promotional materials, and the "Detailed List of Close Relatives of Directors, Supervisors and Senior Executives of Oriental Huijin Futures" provided by the Jilin Securities Regulatory Bureau is incomplete. The company, its executives, shareholders and actual controllers were all punished.
In 2022, Oriental Huijin Futures was ordered to make corrections by the Jilin Securities Regulatory Bureau due to the imperfection of the "three meetings" system, the non-standard operation process, the failure to timely report the freezing of the company's equity held by the controlling shareholder as required, the failure to fulfill the suitability management obligations, and the non-standard operation of the "double recording".
According to public information, Oriental Huijin Futures, formerly known as Jiliang Futures Brokerage Co., Ltd., was established in 2004, and in 2011, the company ushered in a capital increase and share expansion, and the new registered capital was subscribed by Beijing Newheart Investment in cash of 100 million yuan, and since then, Beijing Newcenter Investment has been the company's major shareholder. At present, the registered capital of the company is 153 million yuan, of which Beijing Newstar Investment holds 93.93% of the shares, and Jilin Grain Group Import and Export Co., Ltd. and Jilin Grain and Oil Storage and Transportation Co., Ltd. are also shareholders of the futures company.
According to the company's official website, the business scope of shareholder Beijing Newheart Investment includes project investment, project management, and investment consulting. The company mainly invests in medium and long-term projects in the financial, energy and real estate industries, selectively invests in enterprises with high growth potential, and focuses on financial securities and resource-based projects to obtain greater equity appreciation income and ensure that the company's asset quality is excellent.
However, Tianyancha data shows that the companies invested by the company have been frozen in equity many times. In addition, Orient Huijin Futures was rated as "CCC" in the 2023 futures company classification rating, the same as the rating in 2022, but the company's rating in 2021 was once downgraded to "D".
This article originated from Zhou Xiaoya, a reporter from the Financial Associated Press
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